Current Affairs – December 14, 2024

{GS2 – IR – India-EU} Suspension of MFN Clause by Switzerland

• Context (IE): Switzerland suspends the Most-Favoured-Nation (MFN) clause in its tax treaty with India, potentially affecting $100 billion investment plans and higher taxes on dividends for Swiss companies operating in India starting January 1, 2025.

Need for the MFN Clause

• The MFN clause ensures that a country receives the most favourable tax treatment offered to any other country under a bilateral tax treaty.
• India and Switzerland amended their Double Taxation Avoidance Agreement (DTAA) in 2010 to include such provisions for more favourable tax treatment.

Issues

• Reciprocity in Treaties: Swiss authorities claim that India’s refusal to apply the MFN clause is due to a lack of reciprocity, meaning India’s treatment of Switzerland in tax agreements is not equal to others.
• Supreme Court Ruling (2023): The MFN clause is not automatic and requires a separate notification from India to activate lower tax rates, which has led to Switzerland’s suspension of the clause.
• Increased Taxes: Following the Swiss move, Swiss companies like Nestlé face higher withholding taxes on dividends from January 2025, increasing their tax liabilities in India.

Benefits and Risks

• For India: The increased tax liabilities could boost India’s domestic tax revenues.
• For Switzerland: The suspension signals a stricter approach to international tax agreements, ensuring reciprocity and fairness in treaty provisions.
• Risk of Further Fallout: Other countries may follow Switzerland’s lead, leading to more tax-related challenges for Indian entities and their foreign operations.

Implications for Swiss Investments in India

• It could impact India’s $100 billion investment commitment, part of a trade agreement between Switzerland and three other European Free Trade Association (EFTA) nations signed in March 2024.
• The higher withholding tax could make India a less attractive destination for Swiss companies.
• Companies operating in India could see reduced profits due to higher taxes, potentially reducing future investments.

Way Forward

• Negotiations on Reciprocity: Both nations should engage in discussions to restore the MFN clause or come to a mutual understanding on tax treaty provisions to ensure balanced tax treatment.
• Predictability and Equity in Treaties: It is crucial for India to clarify its stance on MFN clauses and provide a consistent interpretation to avoid complications in future bilateral tax agreements.
• Tax Treaties Review: A comprehensive review and update of DTAA provisions to address evolving international taxation practices and ensure fairness and stability in global tax relations is needed.
• Indian firms operating in Switzerland may need to adjust to higher tax rates, and proactive measures should be taken to manage increased tax liabilities.

{GS2 – IR – Middle East} Syrian Crisis: Implications for Regional Geopolitics

• Context (IE): The collapse of the Bashar al-Assad regime in Syria marks a pivotal moment for Middle Eastern geopolitics, particularly affecting Iran’s regional influence.

Implications for Iran

• Iran’s Strategic Setback: Loss of Syria as a critical ally undermines Iran’s “Axis of Resistance” and its access to Lebanon, reducing support to Hezbollah and other allied factions.
• Diminished Influence: Iranian-backed militias like Hamas, Hezbollah, and Houthi forces face operational setbacks due to Israeli, US and regional pressures.
• Geopolitical Realignments: The fall of Assad destabilises Iran’s foothold, shrinking its influence in the Levant and challenging its broader strategic aspirations.
• Operational Challenges: Key Iranian military figures and proxies have been neutralised, limiting Tehran’s ability to sustain its position in Syria.
• Nuclear Risks: Hardliners in Iran may push for nuclear deterrence as regional challenges mount, increasing risks of escalation.

Geopolitical Implications

• Power Vacuum in Syria: Regional actors like Turkey, Saudi Arabia, and UAE will compete to expand their influence and leverage diplomatic and reconstruction efforts.
• Israeli Countermeasures: Israel may intensify actions against Iran-affiliated groups to curtail Tehran’s influence in Syria and Lebanon.
• Turkey’s Interests: Turkey is likely to maintain a military presence in northern Syria to counter Kurdish movements and secure its borders.
• Iraq’s Balancing Act: Iraq may reassess its ties with Iran amidst shifting regional dynamics and spillover effects from Syrian instability.
• Western Strategic Interests: The US and European allies are expected to intervene strategically to curb militant resurgence and limit Russian-Iranian influence in the Mediterranean.
• Renewed Sectarian Tensions: Sunni Arab states aim to prevent Iran’s resurgence, while militant groups like ISIS may exploit instability.

Also, refer to Arab World Vs. Israel

Way Forward for Stability

• Multilateral Diplomacy: Aligning regional and international efforts to reconcile conflicting national interests is essential for stability.
• Reconstruction: Engaging Syrian factions in reconstruction may reduce volatility & external interference.
• Monitoring Militant Activities: Coordinated intelligence and military efforts are critical to prevent the resurgence of groups like ISIS.

Also, refer to Renewed Phase of Syrian Civil War.

{GS2 – Polity – IC – Elections} Urban Local Government Elections

• Context (TH): The debate on simultaneous elections (ONOE) primarily focuses on national and state elections, often neglecting Urban Local Governments (ULGs), a critical tier of governance.
• The 74th Constitutional Amendment mandates the establishment of Urban Local Bodies (ULBs) with elections every five years, ensuring decentralised governance. It empowers state legislatures to organise elections and assigns State Election Commissions (SECs) responsible for conducting them.

Significance of ULGs

• Economic Contribution: ULGs drive over 60% of India’s GDP, expected to grow with rising urbanisation.
• Population Growth: 40% of India’s population resides in urban areas, projected to surpass 50% by 2050.
• Developmental Catalysts: ULGs enhance economic growth, cultural development & social welfare.

Challenges in Conducting ULG Elections

• Ignored Constitutional Mandate: Over 60% of ULGs face election delays despite the 74th Amendment’s five-year mandate.
• Political Interference: State govts delay elections to retain control, often citing reservation and delimitation issues.
• Disempowered State Election Commissions (SECs): SECs lack autonomy and resources, relying on state governments for key tasks like delimitation.
• Operational Delays: Delays in forming councils post-elections, such as Karnataka’s 11-month average, hinder governance.
• Legal and Judicial Hurdles: Litigation on reservations & vague laws disrupt the timely electoral process.
• Administrative Inefficiencies: Outdated records and poor coordination among agencies delay electoral roll updates and preparations.
• Governance and Policy Neglect: ULG elections are deprioritised compared to state and national elections, exacerbated by public apathy.
• External Challenges: Disasters like COVID-19 strain resources, causing postponements.
• Resource Constraints: Insufficient funding and staffing lead to inefficiencies in election operations.

Impact of Election Delays on Local Development

• Stagnation in Infrastructure Projects: Election delays often halt or delay the implementation of crucial urban infrastructure projects such as roads, sewage systems, and public facilities.
• Slow Urban Governance and Service Delivery: Delays in forming councils lead to interruptions in local governance, affecting service delivery in areas such as waste management, water supply, and healthcare.
• Disruption in Urban Planning and Zoning: Election delays hinder planning decisions, including land-use zoning, development regulations, and urban expansion initiatives.
• Economic Impact on Local Businesses: Local businesses may suffer due to delays in essential policy implementations, business regulations, or infrastructure upgrades.
• Increased Public Discontent: Delayed elections can lead to a lack of accountability, resulting in dissatisfaction among citizens and reduced trust in the local governance system.

Way Forward

• Strengthening State Election Commissions (SECs): Grant SECs autonomy, adequate funding, and resources to ensure independent election management.
• Legislative and Judicial Reforms: Fix deadlines for delimitation and reservation processes; establish judicial benches to fast-track election disputes.
• Policy Interventions: Adopt the ONOE framework for simultaneous elections and enforce mandatory advance scheduling of ULG polls.
• Decentralisation and Governance Reforms: Empower ULGs with resources, devolve authority, and ensure immediate activation of councils post-elections.
• Operational Independence: Ensure self-governance by enabling ULGs to function without administrative or political delays.
• Data and Process Management: Update electoral rolls and governance records in a timely manner to avoid logistical issues.

Role of Technology in Election Management

• Digital Voting Platforms: Introduce secure and accessible online voting systems to increase voter turnout and reduce election-related delays.
• Real-Time Election Monitoring: Implement digital dashboards to track election progress, voter participation, and results in real-time.
• Online Voter Registration and Updates: Enable online registration, updates to voter details, and polling station information to streamline the process and reduce logistical challenges.
• Use of AI for Election Management: Leverage artificial intelligence for better election scheduling and voter outreach and to minimise human error in the electoral process.
• Blockchain for Secure Voting: Adopt blockchain technology to ensure voting data’s transparency, security, and accuracy.

{GS2 – Polity – IC – FRs} Durgadi Fort

• Context (IE): A civil court ruled in favour of the Maharashtra government, rejecting the Muslim community’s claim to the disputed site at Durgadi Fort.

• Location: Kalyan (Maharastra), on the bank of Ulhas river.
• It was a prominent trading port under the Bijapur-based Adil Shahi Sultanate in the 16^th century.
• In 1760, the Marathas captured Kalyan, built a small wooden Durgadevi temple inside the premises, and renamed the fort Durgadi Killa.
• British documents record the fort’s existence since 1570, when it housed a “Musalman tomb, prayer place, and other buildings.” The British took control of Kalyan in 1818, and in 1876, it ceased to be a place of worship after the theft of the idol.

Also refer to Places of Worship Act, 1991.

{GS3 – Envi – Pollutants} Chromium and Mercury Pollution

• Context (DTE): Industrial pollution in Kanpur and Fatehpur districts has reached emergency levels, with chromium and mercury contaminating water, soil and residents’ bodies.

Causes of Mercury and Chromium Poisoning

• Dietary Exposure: Consuming fish with high mercury content.
• Occupational Exposure: Handling mercury or chromium compounds without protective measures.
• Environmental Contamination: Presence of heavy metals in soil and water from industrial pollution.
• Dental Fillings: Old amalgam fillings containing mercury.

Issues Related to Chromium and Mercury Pollution

• Heavy Metal Contamination: Chromium and mercury levels exceed permissible limits in soil, groundwater and surface water, forming toxic ponds in industrial areas.
• Agricultural Contamination: Industrial ash and effluents contaminate soil, water, and agricultural produce, impacting food safety and farming.
• Health Hazards: Increased diseases of the skin, lungs, and liver, as well as mental health problems, along with asthma and respiratory issues, are reported in polluted areas.
• Industrial Effluent Mismanagement: Untreated or partially treated industrial discharges from tanneries and units flow into rivers, canals and agricultural fields.
• Non-functional Sewage Treatment Plants (STPs): Dysfunctional STPs & clogged sewer lines exacerbate pollution.
• Livestock Health Risks: Contaminated water consumed by animals affects livestock health.

Preventive Measures

• Dietary Precautions: Limit consumption of fish known to have high mercury levels.
• Personal Protection: Use personal protective equipment when working with chemicals.
• Environmental Safety: Avoid areas with known mercury and chromium contamination.
• Dental Care: Replace old amalgam fillings with safer alternatives.

Treatment

• Symptom-Specific Treatments:
  • Oxygen therapy through face masks.
  • Medicines to alleviate symptoms.
  • Dialysis in case of kidney involvement.
• Chemical-Specific Treatments:
  • Chelation therapy to remove heavy metals.
  • Surgery in extreme cases to extract contaminants.

Measures for Pollution Control and Public Safety

• Optimize Sewerage Systems: Repair non-functional STPs and sewer lines and implement temporary sewage treatment where necessary.
• Ensure Clean Water Supply: Provide safe drinking water and restore groundwater and river quality in contaminated areas.
• Develop Sustainable Pollution Strategies: Implement long-term plans for pollution control, particularly ahead of events like Maha Kumbh.
• Identify and Restrict Contaminated Sites: Map pollution-affected areas and prohibit construction near underground chromium deposits.
• Strengthen Industrial Regulation: Enforce laws to prevent untreated industrial discharge into rivers, especially the Ganga and its tributaries.
• Institutional Oversight and Accountability: Monitor industrial projects, comply with NGT directives, and ensure regular status reports to authorities like CPCB and NMCG.

{GS3 – S&T – Space} Jezero Crater Rim

• Context (DTE): NASA’s Perseverance Rover climbs atop Jezero Crater Rim on Mars as part of its Northern Rim campaign.

• It is located on the western edge of a flat plain, Isidis Planitia, just north of the Martian equator. The landing site of Perseverance (Jezero Crater) is 3,700 km from Curiosity’s landing site in Gale Crater.
• Jezero Crater was formed by a massive impact about 3.9 billion years ago. Rocks from deep below Mars were thrown upward to form the crater rim. These rocks are believed to be among the oldest found anywhere in the solar system. Rover will now collect samples from these rocks.
• Scientists see evidence that water carried clay minerals from the surrounding area into the crater lake and expect some evidence of microbial life in it.
• NASA and the European Space Agency’s Mars Sample Return Program will bring the samples collected by Perseverance back to Earth.

Source: NASA: Jezero Crater Rim

{Prelims – In News} Athlete Biological Passport (ABP)

• Context (PIB): The World Anti-Doping Agency (WADA) has approved the National Dope Testing Laboratory (NDTL), New Delhi, as an Athlete Passport Management Unit (APMU) to manage the Athlete Biological Passport (ABP).

• NDTL India is now part of a group of 17 APMUs approved by WADA worldwide.
• The ABP is an advanced anti-doping tool that monitors an athlete’s biological markers over time.
• By analysing variations in parameters such as blood and steroid profiles, the ABP helps to ensure fair play in sports and to protect clean athletes.

World Anti-Doping Agency (WADA)

• It is a foundation initiated by the International Olympic Committee based in Canada to promote, coordinate, and monitor the fight against drugs in sports.
• It was set up in 1999, and its headquarters is in Montreal, Canada.
• It is responsible for the World Anti-Doping Code. India’s National Anti-Doping Agency adopts it.

National Dope Testing Laboratory (NDTL)

• Established in 1990 (as the Dope Control Centre under the Sports Authority of India).
• The lab was modernised in 2002 and got WADA Accreditation in 2008.
• An independent body testing body was envisaged to avoid a conflict of interest with SAI.
• In 2004, the Union Cabinet decided to sign the Copenhagen Declaration on Anti-Doping and establish the National Anti-Doping Agency.

{Prelims – In News} India Maritime Heritage Conclave (IMHC 2024)

• Context (PIB): The 1st India Maritime Heritage Conclave (IMHC 2024) was organised by the Ministry of Ports, Shipping and Waterways (MoPSW).

• Theme: “Towards Understanding India’s Position in Global Maritime History.”
• The conclave celebrated India’s historical maritime achievements and highlighted its aspirations as an emerging maritime powerhouse on the global stage.
• Prominent maritime nations, including Greece, Italy, and the UK, joined hands at IMHC to celebrate India’s maritime heritage.

  

Source: PIB

{Prelims – In News} Rajmarg Saathi

• Context (PIB): NHAI Introduces Advanced ‘Rajmarg Saathi‘ Route Patrolling Vehicles (RPV).

  

  Source: PIB

• RPV shall have a dashboard camera equipped with ‘AI video analytics’ to capture and identify potholes and other elements, including vehicles, pedestrians, road signs, and other infrastructure assets.
• NHAI shall collect data/ video footage, including road distress, weekly and integrate this road distress data with the NHAI One application for more efficient road maintenance.

{Prelims – Sci – Chemistry} Trichloroethylene (TCE) & Perchloroethylene (PCE)

• Context (DTE): The US Environmental Protection Agency (EPA) announced final bans on manufacturing, processing, and using trichloroethylene and perchloroethylene.

• Uses: Industry solvents, stain removers, degreasers, dry cleaning. These are linked to severe health issues like kidney cancer, non-Hodgkin lymphoma, cardiac defects and bladder cancer.